Simon sez: if you have cash and a whopping 8k equity in your Nissan lease, buy it out BEFORE it gets totaled, not after.
Your prior post also missed the more important complication: once the insurance company declared it a total loss, the clock started ticking for NMAC/insurance:
The title had to be branded within 10 days of the loss or the loss claim being settled. It canât be sold/transferred without being branded.
It absolutely does. Right on that line where you state that you will disclose any damage to the vehicle right when it happens.
The insurance contract does to, when you disclose the date of purchase of the vehicle and who the lien holder, if any is.
What weâre talking about here is a circumstance where one has failed to properly disclose that information.
Now, I do agree with you that things get a little more interesting if youâve purchased the vehicle and are waiting on the title, however, the date on your bill of sale being listed as before the accident should go a long way to clarifying that issue.
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First off, itâs hard to have a semi-technical discussion when people donât use the same terminology. NMAC is the âlessorâ here AKA the bank or captive.
Second, there is little risk from the lessor side, we can agree on that. If, hypothetically, a bank received a payoff from a lessee without knowing the vehicle in question was damaged or totaled, someone inside the bank would probably cash the check and move your file to the titling department without being the wiser. Banks are just not very good about connecting dots like that.
You know who is, though? Any decently run insurance company. Banks donât worry too much about being defrauded when they receive checks. Insurance companies worry about being defrauded when they send checks. And, unlike the OPâs friend, they didnât hear about this scheme for the first time yesterday.
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Lesson learned here is tell friend no to total leased car with $8k of the captives equity.
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I wonder if heâll take it a step further with a personal injury claim as a result of the accident 
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Iâm still going back to what I said earlier. The insurance company wonât send the check to anyone other than the lienholder listed on the insurance on the date of the incident/accident. You canât get them to remove lienholder unless you have some evidence of ownership of the vehicle and even if you pay off the car immediately, itâll be weeks before you have that and you still wonât have any evidence you were the sole owner with no lienholder on date of incident.
So either way that insurance check is going to the captive. From there, even if we assume the captive is none the wiser about the car accident, what happens is in the captiveâs hands. Will they send you the full amount? Will they send you back just your payoff?
EDIT: I paid off my wifeâs leased car back in November from VW Credit, just noticed the insurance still has VW Credit as the lienholders. Going to see what they require to remove lienholder and will report back in case anyone cares, lol.
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But isnât that kind of the point? The date of the accident is objective. The date of when you intended to payoff the car is also usually fairly objective, too, no? Even if the paperwork takes wks or whatever to show it, I would assume thereâs a fair amount of documentation supporting the intended purchase date.
Iâm not a lawyer, but I assume intention matters here. The documentation of someone who has an accident and then tries to buy out the car is presumably going to look really different from the situation in which someone buys out the car and then, while waiting for the title, has an accident.
I think the grey zone here really is more about whether someone at the insurance company detects the issue. And I cannot imagine that insurance will cut a check w/o asking some basic questions.
I would think theyd care immensely about a driver filing an illegitimate claim though if it means them not having to pay it
The scenario you describe is a compelling hypothetical but itâs not the OPâs scenario.
They did not pay off the car before the total loss event.
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Thatâs not true, insurance companies care a lot about this. Theyâre really particular about lienholder and lienholder release. If they pay you and you donât have legitimate ownership to the vehicle then the actual owner (captive/bank) comes after then, thatâs a major liability.
If you drive a friendâs car and wreck it, insurance will not pay YOU the check, theyâll pay it to the owner, whether thatâs your friend or the captive/bank.
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The few times Iâve had to deal w/ insurance, they ask a lot of questions that seem very clearly aimed at paying the minimum they are obligated to (and, from their perspective, hopefully not paying at all). And I donât have crap insurance.
If youâe in the minority, I think itâs b/c your perspective seems to be that insurance wants to pay out quickly and efficiently. And I imagine most other posters have an experience that, like mine, indicates otherwise.
I am also really interested in any updatesâŚ
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There wonât be any updates because OP will soon realize that what everybody was telling him/her was correct.
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Did you mean âyour friendâ will do it?
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Well, hope springs eternal. 
Hopefully the âfriendâ alter-ego is more reasonable than the OP?
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If you buy the leased car after it is totaled, I suspect the insurance company may not pay either you or the lessor. The lessor has essentially been made whole when you bought the car, so they have suffered no loss. You bought a car that was already damaged, so you have suffered no loss either.
You left out the second part. There wonât be any updates because the OP wonât admit he was wrong and that LH saved him from the biggest mistake of his life. Unless heâs already been in jail.
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Any update? 
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